Mike Ashley’s Sports Direct faces relegation from FTSE 100 index
Sports Direct faces relegation from the FTSE 100 list when the blue chip index of top UK companies comes up for renewal next week, after a dismal performance this year.
Shares in Mike Ashley’s troubled sportswear empire have plunged by 50 per cent since August last year amid growing criticism over its working practices and worsening trading conditions on the high street, which prompted a shock profit warning last month.
The company now has market value of around £2.3bn, making it the 151st biggest company on the London stock market and placing its well into the ranks of the FTSE 250.
Companies face demotion from the index if their value falls below that of the 110th largest company in the rankings. The next quarterly review of the index takes place on Wednesday, with Aberdeen Asset Management also facing demotion.
Sports Direct has been hit by a wave of negative publicity in recent months after coming under fire over its widespread use of zero-hour contracts and for conditions under which many of its staff are said to work, forcing it to issue a statement on the matter in December.
In January, the company warned that full-year profits would be £40m lower than expected, blaming fierce competition and the mild weather in the run-up to Christmas.
The profit warning came a week after the company was forced to clarify the role of new property boss Michael Murray, after it emerged that he was the 26-year-old boyfriend of one of Ashley's daughters.